Wisconsin native, conservative critic of everything.
"Once abolish the God, and the government becomes the God." ---G K Chesterton
"The only objective of Liberty is Life" --G K Chesterton
"Fallacies do not cease to be fallacies because they become fashions" --G K Chesterton
"A man can never have too much red wine, too many books, or too much ammunition." -- Rudyard Kipling

Thursday, October 23, 2008

Your 401(k) to Disappear?

Oh, yah.

Powerful House Democrats are eyeing proposals to overhaul the nation’s $3 trillion 401(k) system, including the elimination of most of the $80 billion in annual tax breaks that 401(k) investors receive.

House Education and Labor Committee Chairman George Miller, D-California, and Rep. Jim McDermott, D-Washington, chairman of the House Ways and Means Committee’s Subcommittee on Income Security and Family Support, are looking at redirecting those tax breaks to a new system of guaranteed retirement accounts to which all workers would be obliged to contribute

That means your employer can no longer write off their contributions to your 401(k), and your capital gains would be taxable year-on-year. In other words, it becomes just another investment or savings account, with no tax benefit at all, and no employer contribution. Instead, Uncle Sam would give you your “matching” funds — up to a whopping $600 per year! Whoopee!

And what do you get as "securities"?

They give you government bonds as your only investment option.Think that's all? Maybe not. There's the Argentine option, too.

Argentina's leftist government has seemingly found a novel way to find the money to stay afloat: cracking open the piggybank of the nation's private pension system.

The government proposed to nationalize the private pensions, which would provide it with much of the cash it needs to meet debt payments and avoid a second default this decade.

Forty years of contributing $5000 a year plus the $600 from the Feds, when invested at 3% will total about $425,000 in today's dollars. That assumes that the inflation adjustment keeps up with actual inflation, including food & fuel.

My kids and grandkids can forget about retiring, unless they get government jobs.